Part 1: Why Companies Fail - A View From The Bottom

 

I once asked Charlie Stacey* what personality traits I should watch for to signal personality disorder.  He said, "lack of self awareness and the inability to change".  In other words, everyone is at a different stage of growth, but those two things signal that a person can become healthier, even if they are not currently.  For example, narcissistic personality disorder is essentially some part of the psyche getting stuck in early childhood developmental stages, often because of trauma between the ages of two and four.

Organizations, like any complex organism, have personalities, and I posit, can have personality shortcomings.  Oftentimes this follows the personality of someone in leadership, someone of influence, or a combination of people.  They can be overly cautious or reactive or distrustful or a hundred other things.

This tends to manifest as patterns that repeat themselves within the organization - think fractals - much like generational patterns in families.  If the org (the organization, the organism) lacks the self-awareness to spot those fractals, they will continue indefinitely, for better or worse.  Let's take a look at a few traits I have seen manifest in organizations. 

Reactivity

If an organization is reactive, this often manifests in frequent changes in direction.  There will always be some market trend, competitor action, or customer request that seems all important in the moment, and the reactive company will drop everything to address it.  The signs are easy to spot:

• A trail of unfinished projects
• Teams regularly missing deadlines because they are busy putting out fires or estimating new potential projects.
• Rapidly accumulating technical debt, because there is never time to do things right or to go back & fix tech debt later.

The problem is that these companies end up spinning their wheels.  So much time is spent context-switching & chasing short-term wins that essential long-term work never gets done.

There is a saying, attributed to a variety of people, which I repeat often to my teams: "Slow is smooth, smooth is fast".  Frenetic action rarely saves time.  In my experience, as pressure mounts, so does the tendency to become reactive.  Perhaps because I just finished The Last Kingdom, I picture an army bracing for battle as the enemy charges.  The commander screams, "Hold the line!" because being reactive in that situation means the enemy breaks through.  The right course of action, even with existential organizational threats, is often to have the fortitude to stay the course set when heads were clearer. 

Like any personality attribute, reactivity exists because it is advantageous in some situations.  For example, in an early startup, the ability to pivot quickly can mean the difference between the company surviving or failing.  But, at a certain scale, it becomes a weakness.  At scale, customers expect a certain level of polish to features, a certain level of reliability, a certain level of performance.  Those things rarely come from quick & dirty solutions.

I would be remiss if I didn't mention something: reactive companies can be exciting - in the same way that adrenaline sports are exciting.  They are exciting because there is a chance that things could go very badly.  Those quick & dirty solutions breed a firefighting culture - exciting, and it will kill your company. 

Resistance to Change

Perhaps the polar opposite is resistance to change.  Andrew Harmel-Law had the keen insight that code often follows the personality of the person who wrote it.  I have seen this firsthand in an organization that had a personality resistant to change.  Dependencies in the code stayed just ahead of end-of-life, and upgrading them often became a massive undertaking.  Classes were not written to be extensible.  Obsolete technologies were used, because they were familiar.

 

A common characteristic of these companies is that products, code, & services calcify and become so expensive to maintain that they are often completely replaced rather than being reworked.  The catch is that, unless the company's personality has changed, the replacement will be just as rigid and will, in turn, be replaced after a few years.

 

Self Preservation

I once sat in a meeting where I was grilled by a manager three levels above me regarding delays on his pet project, while the two levels of management between us sat gazing at the ceiling.  This, in my opinion, is weak leadership.  It is self-preservation at the expense of others.

After this event, I bemoaned to Charlie the fact that so few managers protect their people.  He said something that surprised me.  That behavior is similar to children of alcoholics.  "What do I stand for? ... What do you want me to stand for?  Or, what do I need to stand for in this situation to avoid getting hurt?"  They stand for anything and nothing and won't stand up for their people if there is any risk to themselves.

In my opinion, that is a crucial role for a manager - giving their teams space to take risks without every move being scrutinized from on high.  The weak managers were excellent politicians, able to play the chameleon to avoid attack.

The effect on the org is that they won't affect meaningful change if there is friction.  This results in problematic patterns going unaddressed indefinitely.

In my experience, these leaders tend to be highly impersonal, rarely talking about their personal lives, their weaknesses, or their failures - because these things could be ammunition for a political opponent.  There is, of course, some wisdom in that.  However, they lack authenticity, and people tend not to trust them.  I have far more respect for leaders who, while they have learned to be guarded, deliberately let their true selves shine through.  True strength is not the ability to conceal weakness, but to succeed in spite of it.

Part 2: What is to be done? 

* Much of this article has come from discussions with Charlie.  If there are nuggets of wisdom to be found here, they are probably his.